Is it time to change benefits?
Howard Finch, August 19, 2020
Working patterns and practices have been steadily changing for many businesses over the past few years however, the COVID-19 pandemic has dramatically accelerated these shifts – with the trend towards remote working being the most visible.
At the same time, the pandemic has also begun to change the benefits that employees value, and the ways in which they are accessed and communicated.
However, many UK employers, in particular SMEs, could adapt faster to meet these new needs.
The case for innovation
As the working and benefit environment reshapes itself and many companies move to adapt to a new normal, now is the time for many SMEs to reboot their benefit offerings and employee engagement to level the playing field with their larger counterparts.
Larger employers allow their staff to choose and flex benefits online, reducing manual work and improving engagement. SMEs, on the other hand, have often struggled on this front, perhaps due to limited HR resources.
However, with a little technological innovation, SMEs can easily emulate the benefit offerings of larger companies, which play an essential role in attracting and retaining the best talent.
SMEs indicate several perceived barriers to introducing benefit technology including initial costs of implementation, concerns with system reliability and lack of familiarity.
However, from the perspective of the staff administering the schemes, maximising efficiency and minimising manual work should be points of priority.
In SMEs, where staff often juggle more than one role (i.e. HR, payroll and finance), the paper-based methods frequently relied upon are clearly becoming less appropriate – from both a logistical and an efficiency standpoint.
Technology can link and automate HR activities, in turn reducing admin and enabling staff to manage benefit communications effectively, efficiently and – crucially – remotely.
A few practical steps
To get the ball rolling and their benefit offerings on the optimal track, there are three practical steps for businesses to take.
Step one: review.
SMEs must ensure their benefit offering remains relevant and appropriate to employees. This is more pertinent now than ever, as traditional benefits such as gym membership and season tickets are for many, at least in the short-term, less desirable. Where necessary, these should be replaced with substitute perks that suit new aspirations and working patterns.
To get a feel for what this means, organisations might consider conducting a benefit survey of their employees to gauge current engagement and ongoing needs and desires. This will provide HR leaders with the insights they need to formulate an annual plan and refine their benefits packages in line with employee expectations.
Step two: negotiate and recalibrate.
This step is about putting into practice the feedback gained throughout the review process. To make this happen, SMEs should first consider where monies can be saved on current benefits, negotiate lower premiums, and introduce salary exchange on pensions.
With those savings, and armed with the review results, they can then enhance benefits to reflect current circumstances. For instance, they might introduce a more comprehensive health and wellbeing offering, or general financial education, to support employees physically, mentally and financially.
Step three: integrate technology.
Benefit technology can help improve efficiency and personalisation. For example, linking and automating HR and payroll systems will create a hub with seamless data transfer and more effective Management Information reporting.
The net result of actions like these will be reduced administration time, improved accessibility and a higher profile for benefits throughout the company. The benefits themselves are of course important, but they won’t be as impactful without great delivery.
Moreover, the use of the technology can be adapted and adjusted as the business develops, so that it remains relevant and valuable.
The pace of development is startling – employers need to adapt to the rapidly changing expectations by reinvigorating their approach to benefits and associated communications, and in turn their workforce.
Howard Finch is managing director of employee benefits consultancy Vested, part of Embark Group.